a bond with par value of 1000 trading at 97.5 sells for a premium

Question

Question

Answer 1

Answer #1

Solution:

The statement is false.

Because A bond with par value of $1000, Trading at 97.5 sell for a discount.

Issue price = 1000 * 97.5% = $975

Discount = Face value - Issue price = $1000- $975 = $25

Hence, the statement is false.

Answer 2

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